Second Reading-JUSTICE LEGISLATION MISCELLANEOUS AMENDMENTS BILL 2019

Mr FREGON (Mount Waverley) (16:28): I rise to speak on the Justice Legislation Miscellaneous Amendments Bill 2019. I would like to just start by mentioning a couple of my colleagues who mentioned a few things I would like to point out. Firstly, the member for Frankston—I do not think I have ever heard anyone mention Better Call Saul in Parliament before, so that was a nice little thing. His comments on the reasoned amendment that is before us I believe were summed up, if I can paraphrase, by it being more of an ‘unreasonable amendment’. He also spoke about the wages that were stolen from Indigenous Australians in Queensland.

 

I think we are seeing more and more companies coming out in the news. I think there was even one today, which I will not name, putting themselves out there that they have not paid people what they should have paid people. I can only imagine that they are doing this on the basis that they know that there are wage theft laws coming and they are probably better off saying it now. This is something our government is committed to, and I think these changes in regard to our class action laws are part of what will hopefully mean our big corporations act in a more dutiful and better way so they are actually paying their staff proper amounts.

 

I also want to point out that my good colleague and neighbour, the member for Burwood, pointed out that the member for Ovens Valley seemed to comment ‘on a diverse range of views’, I think was the statement. I guess, go figure—this is the house for a diverse range of views, so that is not a particular surprise. I must admit that most of the time when we wait for the members on the other side to stand we sort of know, really—you get a sense that you know already—what they are going to say. The member for Burwood and I coined the phrase before: it is like ‘pre-ja vu’.

 

I think the cornerstone of our legal system is that every person has fair and open access to seek the justice that they deserve. But lawyers are expensive, and very experienced lawyers are very expensive. We do not all have a retired QC who comes and knocks on our door and offers to take us to the High Court and look after us, Mr Kerrigan-style, so this bill makes it more possible for our everyday Joe and Joanne to get the access to justice that they deserve. So I thank the Attorney-General for her hard work in relation to this important bill. The government has made and will continue to make significant reforms in areas which affect everyday Victorians in regard to regulations to protect workers from silicosis and stamping out wage theft as well. We will use all avenues to support and protect our workers and consumers, including updating our class action laws, which we are here to do today.

 

I would also like to thank our previous Attorney-General for his work in asking the Victorian Law Reform Commission to inquire into access to the law with regard to class actions. That request for that review, which was commenced in 2016, has set us down a path which has brought us here to this bill today. In amending the Supreme Court Act 1986—which, by the way, was a very good year, and my old Jag that is gone now was an ‘86 series 3, a very nice car; I miss it very much—this bill gives rise to recommendation 8 of the Victorian Law Reform Commission’s Access to Justice: Litigation Funding and Group Proceedings report of March 2018. There is a mouthful.

 

While I am on that, a quick note of thanks for the lifelong service of the late Honourable Philip Cummins, AM, who was chair of the commission at the time. His distinguished career over six decades saw him serve as a judge of the Supreme Court of Victoria for 21 years, and it is the same Supreme Court that this bill will affect. He contributed not only to this legislation but greatly to our legal system and was a great advocate for victim rights.

 

This bill will improve access to justice for Victorians by making it possible for class actions to proceed where they would be prevented because of the financial risks to plaintiffs in legal costs. The commission found that in Victoria class actions are under-utilised. I think I heard from other members the figure of five a year, on average. For a class action to proceed there must be a lead or representative plaintiff on behalf of a group of claimants. The real risk for that lead plaintiff is that if the matter is unsuccessful they are sort of left holding the bag. Most of these cases are David versus Goliath cases—telcos, banks and insurance companies that are very well lawyered up. That is their right, that is the process, that is the legal system we have, but it means that if a case is unsuccessful the everyday Joe Blow can lose it all—lose a home, lose whatever he has got. That is not just affecting him; that is affecting his family. When we think about cases of silicosis, that person may already have a life-altering malady inflicted on them, so I think this bill giving access to justice for these people makes sense.

 

The law reform commission found that if lawyers could charge a percentage amount of a potential settlement whilst at the same time indemnifying that lead plaintiff for the other side’s costs, that would lower the risk for the plaintiff and therefore more cases would likely go ahead where otherwise they would not because of that potential financial burden. This bill achieves this by providing the ability for the Supreme Court to make group costs orders. It is worth restating that the lawyers for the plaintiffs would have to indemnify that plaintiff for any adverse costs in order for the group costs orders to be granted. The court can also order those same lawyers to provide security for those said costs, so the court is instrumental in this process. In practice, a representative or lead plaintiff in a class action may apply to the Supreme Court for a group costs order. The court may then choose to grant such an order which would have the effect of the plaintiff’s lawyers receiving a percentage of any recovered amount.

 

The Supreme Court has a very important role, as I said, in providing the checks and balances, and these orders are subject to the court’s strict supervision. This bill does not tell the court exactly how to make those decisions. It does not tell them how much to choose as the percentage. That is well within the jurisdiction of that court to decide, and that is the right place. It should not be politicians making that decision; it should be our Supreme Court justices. Therefore this adds further protection for class members and safeguards the fairness of any group costs orders. It is worthy of note also that the court can adjust the percentages at any time within the proceedings.

 

There are several reasons why this bill will benefit class members, but key to the intent of this bill is to remove any financial barrier to commencing a class action for smaller and lower value claims. In our current system, these can be uneconomic to run but potentially more likely to be run on a group costs order basis. The court is also able to improve transparency within this process for class members, and arrangements should therefore be fairly simple for the members to understand. Percentage-based fees are currently banned under the Legal Profession Uniform Law. However, this bill is not inconsistent with this uniform law because there is no prohibition on the Supreme Court from making a group costs order. I think it is worth saying that we do not necessarily want to take ourselves to an American free-for-all system, where we have 10-metre-high billboards for personal injury lawyers. That is not what this bill is trying to do. This bill is trying to give access to justice for the everyday bloke.

 

The bill implements one recommendation from the Victorian Law Reform Commission’s Access to Justice report. The government is considering the remaining 13 recommendations, which were directed, and will consult with relevant stakeholders. Should further legislative amendments be required, then they will be introduced at a later time. It is worth noting that in the recommendation we are addressing today the commission stated that the approval of any common fund or group costs orders should be subject to conditions that are set out in legislation, as we bring today, or the Supreme Court’s practice note on class actions. Most of the commission’s recommendations are directed to the Supreme Court on that class actions practice note, and the court is currently working on amendments to it, as is right. I commend the bill to the house.